The Degree of Operating Leverage (DOL), at a Given Sales

question 57

Multiple Choice

The degree of operating leverage (DOL) , at a given sales volume, is equal to:

• A) (Operating profit − fixed expenses)/sales.
• B) (Sales − variable expenses)/operating profit.
• C) Operating profit/(fixed expenses − variable expenses).
• D) Sales/(fixed expenses A − operating profit).
• E) Fixed costs/Total contribution margin.

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Definitions:

Capability

The ability or quality that something has to perform or achieve a certain task or function.

Without Being Detected

Conducting activities in a manner that avoids discovery or notice by others.

Network & Sharing

A feature in operating systems that enables the sharing of data, resources, and files among multiple computers over a network.

Network Connections

The points of contact through which a computer communicates with other computers on a network, enabling data exchange.